What's happening 🧐

On August 4, the daily average 30-year fixed mortgage rate dropped to 6.57%, the lowest level in the past 10 months, according to Redfin. This marks a notable shift after July closed with an average of 6.72% and follows a peak of 7.08% in May. For buyers, this decline is more than just a number. It translates to increased purchasing power. A household with a $3,000 monthly budget can now afford approximately $20,000 more home than they could just a few months ago.

Why This Matters 💪

Lower Rates Mean Greater Affordability 

Even a modest drop in interest rates can have a meaningful impact. For example, a $500,000 home at a 7% interest rate comes with a monthly payment of about $2,661. At 6.5%, that same home costs around $2,528 per month. That is a savings of $133 each month, or nearly $1,600 per year.

Seller Concessions Are Becoming More Common

In the first quarter of 2025, 44.4 percent of U.S. home sales included seller concessions, up from 39.3% the previous year. But it is not just about concessions. Sellers are also accepting lower prices.

• 21.5% of homes sold had both a concession and a final sale price below asking, up from 18.5%
• 16.2% included a price cut and a concession, up from 13%
• 9.9% had all three: a concession, a price cut, and a final sale price below asking, up from 8%

This data points to a more flexible market where buyers are gaining leverage.

What This Means for Buyers  💎

Today’s market presents a rare opportunity

• Buyers have room to negotiate, whether for closing credits, rate buydowns, or price reductions
• Recent interest rate drops improve affordability compared to earlier this year
• Competition is still moderate, which means more options and less pressure

Why Waiting Might Cost You More 🫠

Trying to time the market perfectly is always a challenge. Many buyers have been hesitant due to higher interest rates, often comparing them to the historically low levels of 2021. However, that period was the exception and might be a once in lifetime event for interest rates. According to Freddie Mac, 30-year mortgage rates have not dropped below 6% since September 2022.

Today’s market presents a unique combination: sellers who are more open to negotiation, relatively stable home prices, and a slight dip in interest rates. With fewer buyers actively shopping, there is more breathing room and less competition.

Waiting for mortgage rates to fall below 6% might seem appealing, but if that happens, it could trigger a wave of buyer demand and drive prices up. If rates go up again, your monthly payments and long-term borrowing costs increase. If they go down, you always have the option to refinance.

Buying now allows you to lock in a home, start building equity, and take advantage of current market conditions while they are still in your favor.

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Want to see if now is a good time to buy for you?